As we write these notes in late January 2009 the economic depression is worsening with each passing day, creating previously unthinkable conditions. Even as production sinks and unemployment soars in the “real economy,” the implosion of the financial sector remains at the center of the crisis. It is now widely acknowledged in financial and policy circles that nationalization of the U.S. banking system, under one or another description, is inevitable. The Obama administration still resists what is referred to as a “complete nationalization,” with the government wiping out the bank shareholders and taking over the running of the banks. But every other option on the table involves further steps in this direction. Already the U.S. Treasury has received shares and other securities from 314 financial institutions in return for $350 billion in government bailout money.
Volume 60, Issue 10 (March)
In referring in my title here to “A Failed System” I do not of course mean that capitalism as a system is in any sense at an end. Rather I mean by “failed system” a global economic and social order that increasingly exhibits a fatal contradiction between reality and reason—to the point, in our time, where it threatens not only human welfare but also the continuation of most sentient forms of life on the planet. Three critical contradictions make up the contemporary world crisis emanating from capitalist development: (1) the current Great Financial Crisis and stagnation/depression; (2) the growing threat of planetary ecological collapse; and (3) the emergence of global imperial instability associated with shifting world hegemony and the struggle for resources. Such structural weaknesses of the system, as Joseph Schumpeter might have said, are the product of capitalism’s past successes, but they raise catastrophic problems and failures in the present nonetheless. How we choose to act today in response to this failed system is therefore the most critical question that humanity has ever faced.
In the opening decade of the twentieth century the German national state united the great majority of the German speaking population of Europe, excluding only those in Switzerland and the Austro-Hungarian Empire, and was among the leading states of the world. It boasted technologically advanced industry, among the highest per capita GDP, and the second largest army and third largest navy in the world. Germany was at peace, save for minor military operations against disobedient natives in Southwest Africa. It was a state that was among world leaders in providing basic social insurance, yet held sacred private property and the rule of law, except only in strictly prescribed areas of national security. In the opening decade of the twenty-first century the German national state unites the great majority of the German speaking population of Europe, excepting only those in Switzerland and Austria, its industry is technologically advanced and its per capita GDP high. Its military budget is the sixth largest in the world, and it is at peace, save for minor military operations against disobedient natives in Afghanistan. Despite cutbacks, few states in the world have better provision of basic social insurance, and Germany today prides itself on holding private property to be sacred and on its adherence to the rule of law, except for a few strictly prescribed areas of national security. In the fourth and fifth decades of the twentieth century the German national state committed crimes universally agreed to be the most horrendous in human history.
Who could have imagined the 2008 presidential campaign?
Commentators, media people, and especially politicians fell all over themselves proclaiming that the 2008 election had, “nothing at all to do with race.” And yet every event, every speech and comment, every debate and appearance had race written all over it. Stephen Colbert, the brilliant satirist, hit it on the head when he asked a Republican operative, “How many euphemisms have you come up with so far so that you won’t have to use the word ‘Black?’” Everyone laughed good-naturedly.
Vijay Prashad’s The Darker Nations opens with the assertion that the third world was not so much a place as a project. His goal is to provide an account of the anticolonial and nonaligned movement rather than a full history of the under-developed world in the last half of the twentieth century. However, in this remarkable book, he does both. Born in the wake of the upheavals of the Second World War, the third world movement that took form at the Bandung Conference in 1955 was championed by the likes of Nehru, Nasser, Tito, Sukarno, and Nkrumah. Its leaders collectively called for national independence, economic development, and Cold War nonalignment while basing themselves on the support of millions of followers in the under-developed nations.